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Jan 17, 2022 · 20m · top-founders

6k Freelancers Use Xolo To Run Their Business, $5.5m Revenue, Raising $20m Now

Allan Martinson · 10m spoken Nathan Latka · 7m spoken
0:00 / 0:00

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In this episode of Conversations with Nathan Latka, Xolo CEO Allan Martinson discusses scaling an administrative SaaS and fintech platform for European freelancers to $5.5 million in ARR. He breaks down Xolo's hybrid subscription and transaction revenue model, Estonia-based talent advantages, customer churn dynamics, and their upcoming $20 million Series B fundraising round.

How this conversation actually went

Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 39.9% of the talking time here. How this is scored →

Nathan as informed peer 5.3 Guest teaching 3.3 Guest disagreement 1.9 Nathan pushing back 3.6
05100:0010:0020:000:50–3:00 · Nathan as informed peer 4/10 Introducing Allan Martinson and His Entrepreneurial Track Record Nathan introduces Allan and reviews his prior founding and VC background. Allan politely clarifies that the Baltic region consists of three separate countries before laying out Xolo's value proposition for freelancers.3:00–5:56 · Nathan as informed peer 6/10 Subscription Pricing, Transactional GMV, and Revenue Streams Nathan breaks down Xolo's hybrid model between monthly subscription tiers and transactional GMV fees. He does real-time mental math calculating monthly take rates from GMV volume.5:56–7:56 · Nathan as informed peer 5/10 Company Origins, Estonia E-Residency, and Allan's CEO Appointment Allan clarifies that Xolo is not a job marketplace but a business operations tool powered by Estonian e-residency. Nathan asks why an experienced VC and operator would join as an executive hire.7:57–10:21 · Nathan as informed peer 6/10 Capitalization History, Series A Extension, and Team Allocation Nathan explicitly pushes Allan to disclose his equity package as an incoming CEO. Allan parries with broad terms while outlining their Series A extension and headcount allocation.10:24–14:12 · Nathan as informed peer 5/10 Sponsor Break: Streamlining SaaS Integrations with Paragon Following the sponsor break, Allan corrects Nathan's ARPU multiplication, clarifying that total MRR is 400k euros across mixed revenue streams rather than $600k pure subscription revenue.14:13–17:20 · Nathan as informed peer 6/10 Series A Dilution, ESOP Pool, and Cap Table Breakdown Nathan reconstructs the company's cap table and valuation history, then presses Allan for a Series B valuation target. Allan deflects by stating that valuation is the investors' job.17:20–19:47 · Nathan as informed peer 5/10 Annual Churn Dynamics and Net Dollar Retention Allan clarifies that the 20-25% churn figure is annualized rather than monthly and admits net dollar retention is slightly under 100%. The interview finishes smoothly with the standard rapid-fire questions.0:50–3:00 · Guest teaching 2/10 Introducing Allan Martinson and His Entrepreneurial Track Record Nathan introduces Allan and reviews his prior founding and VC background. Allan politely clarifies that the Baltic region consists of three separate countries before laying out Xolo's value proposition for freelancers.3:00–5:56 · Guest teaching 2/10 Subscription Pricing, Transactional GMV, and Revenue Streams Nathan breaks down Xolo's hybrid model between monthly subscription tiers and transactional GMV fees. He does real-time mental math calculating monthly take rates from GMV volume.5:56–7:56 · Guest teaching 4/10 Company Origins, Estonia E-Residency, and Allan's CEO Appointment Allan clarifies that Xolo is not a job marketplace but a business operations tool powered by Estonian e-residency. Nathan asks why an experienced VC and operator would join as an executive hire.7:57–10:21 · Guest teaching 2/10 Capitalization History, Series A Extension, and Team Allocation Nathan explicitly pushes Allan to disclose his equity package as an incoming CEO. Allan parries with broad terms while outlining their Series A extension and headcount allocation.10:24–14:12 · Guest teaching 5/10 Sponsor Break: Streamlining SaaS Integrations with Paragon Following the sponsor break, Allan corrects Nathan's ARPU multiplication, clarifying that total MRR is 400k euros across mixed revenue streams rather than $600k pure subscription revenue.14:13–17:20 · Guest teaching 4/10 Series A Dilution, ESOP Pool, and Cap Table Breakdown Nathan reconstructs the company's cap table and valuation history, then presses Allan for a Series B valuation target. Allan deflects by stating that valuation is the investors' job.17:20–19:47 · Guest teaching 4/10 Annual Churn Dynamics and Net Dollar Retention Allan clarifies that the 20-25% churn figure is annualized rather than monthly and admits net dollar retention is slightly under 100%. The interview finishes smoothly with the standard rapid-fire questions.0:50–3:00 · Guest disagreement 1/10 Introducing Allan Martinson and His Entrepreneurial Track Record Nathan introduces Allan and reviews his prior founding and VC background. Allan politely clarifies that the Baltic region consists of three separate countries before laying out Xolo's value proposition for freelancers.3:00–5:56 · Guest disagreement 1/10 Subscription Pricing, Transactional GMV, and Revenue Streams Nathan breaks down Xolo's hybrid model between monthly subscription tiers and transactional GMV fees. He does real-time mental math calculating monthly take rates from GMV volume.5:56–7:56 · Guest disagreement 2/10 Company Origins, Estonia E-Residency, and Allan's CEO Appointment Allan clarifies that Xolo is not a job marketplace but a business operations tool powered by Estonian e-residency. Nathan asks why an experienced VC and operator would join as an executive hire.7:57–10:21 · Guest disagreement 2/10 Capitalization History, Series A Extension, and Team Allocation Nathan explicitly pushes Allan to disclose his equity package as an incoming CEO. Allan parries with broad terms while outlining their Series A extension and headcount allocation.10:24–14:12 · Guest disagreement 2/10 Sponsor Break: Streamlining SaaS Integrations with Paragon Following the sponsor break, Allan corrects Nathan's ARPU multiplication, clarifying that total MRR is 400k euros across mixed revenue streams rather than $600k pure subscription revenue.14:13–17:20 · Guest disagreement 3/10 Series A Dilution, ESOP Pool, and Cap Table Breakdown Nathan reconstructs the company's cap table and valuation history, then presses Allan for a Series B valuation target. Allan deflects by stating that valuation is the investors' job.17:20–19:47 · Guest disagreement 2/10 Annual Churn Dynamics and Net Dollar Retention Allan clarifies that the 20-25% churn figure is annualized rather than monthly and admits net dollar retention is slightly under 100%. The interview finishes smoothly with the standard rapid-fire questions.0:50–3:00 · Nathan pushing back 1/10 Introducing Allan Martinson and His Entrepreneurial Track Record Nathan introduces Allan and reviews his prior founding and VC background. Allan politely clarifies that the Baltic region consists of three separate countries before laying out Xolo's value proposition for freelancers.3:00–5:56 · Nathan pushing back 2/10 Subscription Pricing, Transactional GMV, and Revenue Streams Nathan breaks down Xolo's hybrid model between monthly subscription tiers and transactional GMV fees. He does real-time mental math calculating monthly take rates from GMV volume.5:56–7:56 · Nathan pushing back 2/10 Company Origins, Estonia E-Residency, and Allan's CEO Appointment Allan clarifies that Xolo is not a job marketplace but a business operations tool powered by Estonian e-residency. Nathan asks why an experienced VC and operator would join as an executive hire.7:57–10:21 · Nathan pushing back 6/10 Capitalization History, Series A Extension, and Team Allocation Nathan explicitly pushes Allan to disclose his equity package as an incoming CEO. Allan parries with broad terms while outlining their Series A extension and headcount allocation.10:24–14:12 · Nathan pushing back 4/10 Sponsor Break: Streamlining SaaS Integrations with Paragon Following the sponsor break, Allan corrects Nathan's ARPU multiplication, clarifying that total MRR is 400k euros across mixed revenue streams rather than $600k pure subscription revenue.14:13–17:20 · Nathan pushing back 6/10 Series A Dilution, ESOP Pool, and Cap Table Breakdown Nathan reconstructs the company's cap table and valuation history, then presses Allan for a Series B valuation target. Allan deflects by stating that valuation is the investors' job.17:20–19:47 · Nathan pushing back 4/10 Annual Churn Dynamics and Net Dollar Retention Allan clarifies that the 20-25% churn figure is annualized rather than monthly and admits net dollar retention is slightly under 100%. The interview finishes smoothly with the standard rapid-fire questions.

speaking balance: gold is Nathan, purple is the guest (3 minute bins)

0:00 · Nathan 49.5% · guest 50.5%0:00 · Nathan 49.5% · guest 50.5%3:00 · Nathan 24.4% · guest 75.6%3:00 · Nathan 24.4% · guest 75.6%6:00 · Nathan 22.6% · guest 77.4%6:00 · Nathan 22.6% · guest 77.4%9:00 · Nathan 51.1% · guest 48.9%9:00 · Nathan 51.1% · guest 48.9%12:00 · Nathan 44.3% · guest 55.7%12:00 · Nathan 44.3% · guest 55.7%15:00 · Nathan 38% · guest 62%15:00 · Nathan 38% · guest 62%18:00 · Nathan 54.6% · guest 45.4%18:00 · Nathan 54.6% · guest 45.4%
Sharpest disagreement ▶ 16:52 Allan resists committing to a Series B valuation target

When Nathan presses Allan to name an expected multiple or valuation for their Series B round, Allan refuses to give a figure, pushing back that it is the VCs' job to do the pricing work.

 Hardest push from Nathan ▶ 7:57 Nathan demands exact equity compensation numbers

Nathan directly challenges Allan to be specific about his executive compensation and equity package rather than offering generic VC answers.

 Biggest teaching moment ▶ 13:08 Allan corrects Nathan's MRR napkin math

Nathan attempts to multiply 6,000 paying users by $100 ARPU to assert $600k in monthly subscription revenue, but Allan corrects the metric down to 400k euros across all revenue types.

 Nathan holds their own ▶ 15:30 Nathan reconstructs the full cap table breakdown

Using Allan's scattered dilution and ESOP figures, Nathan quickly calculates the approximate equity ownership percentages across founders, incoming CEO, ESOP, and investors.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Introducing Allan Martinson and His Entrepreneurial Track Record 4211 Nathan introduces Allan and reviews his prior founding and VC background. Allan politely clarifies that the Baltic region consists of three separate countries before laying out Xolo's value proposition for freelancers.
Subscription Pricing, Transactional GMV, and Revenue Streams 6212 Nathan breaks down Xolo's hybrid model between monthly subscription tiers and transactional GMV fees. He does real-time mental math calculating monthly take rates from GMV volume.
Company Origins, Estonia E-Residency, and Allan's CEO Appointment 5422 Allan clarifies that Xolo is not a job marketplace but a business operations tool powered by Estonian e-residency. Nathan asks why an experienced VC and operator would join as an executive hire.
Capitalization History, Series A Extension, and Team Allocation 6226 Nathan explicitly pushes Allan to disclose his equity package as an incoming CEO. Allan parries with broad terms while outlining their Series A extension and headcount allocation.
Sponsor Break: Streamlining SaaS Integrations with Paragon 5524 Following the sponsor break, Allan corrects Nathan's ARPU multiplication, clarifying that total MRR is 400k euros across mixed revenue streams rather than $600k pure subscription revenue.
Series A Dilution, ESOP Pool, and Cap Table Breakdown 6436 Nathan reconstructs the company's cap table and valuation history, then presses Allan for a Series B valuation target. Allan deflects by stating that valuation is the investors' job.
Annual Churn Dynamics and Net Dollar Retention 5424 Allan clarifies that the 20-25% churn figure is annualized rather than monthly and admits net dollar retention is slightly under 100%. The interview finishes smoothly with the standard rapid-fire questions.

Statements from this episode (14)

Assertion Not checkable as stated
Martinson: Xolo average subscription price is €70 to €80 per month
“The majority of our revenues coming from subscription payments. So it was, it is anything between 29 to a 199, depending on the package, depending on the country and the level of the service. So in average is about 70 euros, 80 euros, and like closer to a hund…”
Allan Martinson Jan 17, 2022 ▶ 3:07
Assertion Not checkable as stated
Martinson: Xolo transactional contractor product processed nearly €2M in monthly GMV
“If you take that particular product and where we only charge our transactional fee, it's close to two million euros processed.”
Allan Martinson Jan 17, 2022 ▶ 4:26
Assertion Not checkable as stated
Martinson: Xolo paying customers generate €20M to €25M per month
“The total amount of the revenue of our customers, our paying customers, it's about 20, twenty-five million per month.”
Allan Martinson Jan 17, 2022 ▶ 4:43
Disclosure
Martinson: Hired CEO's equity matches Xolo's original co-founders
“Yeah, I can say that my equity interest is on par with the founders. So yeah, there is no discrepancy on that front.”
Allan Martinson Jan 17, 2022 ▶ 8:07
Assertion Supported
Martinson: Senior Estonian tech engineers earn roughly $70,000 to $80,000 annually
“I would say it's a four to 5000 euros per month, which translates into like 70 to 80,000 dollars.”
Allan Martinson Jan 17, 2022 ▶ 11:51
Assertion Not checkable as stated
Martinson: Xolo has 5,000 to 6,000 paying customers and 100,000 signups
“Today we have about five, 6000 paying customers. And since we have a freemium product, people can sign up. And as I said, we have a 100,000 people signed up”
Allan Martinson Jan 17, 2022 ▶ 12:23
Assertion Not checkable as stated
Martinson: Xolo generates approximately €400,000 in MRR
“We have about 400,000 euros in MRR right now.”
Allan Martinson Jan 17, 2022 ▶ 13:09
Insight
Martinson: Freelancer ARPU cannot scale endlessly through upselling
“Our ARPU has been pretty stable, and so it's not too much upsell, because our customers are really small businesses, or maybe even like part-time freelancers. You can't increase ARPU like endlessly with those guys, which means that then almost all of our marke…”
Allan Martinson Jan 17, 2022 ▶ 13:50
Disclosure
Martinson: Early-stage investors own about 50% of Xolo's cap table
“We have about half of our cap table in the hands of Seed, pre-seed, and series A investors.”
Allan Martinson Jan 17, 2022 ▶ 14:57
Disclosure
Martinson: Xolo's ESOP pool represents 15% to 16% of cap table
“Yeah, we do have ESOP covering all of our employees, and we are in a bit, like, non-standard situation because we have several high-level executives who joined later, so that's why our ESOP is probably a bit bigger than usual, so it's about 15, 16% of the cap …”
Allan Martinson Jan 17, 2022 ▶ 15:14
Disclosure
Martinson: Xolo is targeting a 15M to 18M euro Series B round
“It's about 15, eighteen million euros that we are targeting right now.”
Allan Martinson Jan 17, 2022 ▶ 16:36
Opinion
Martinson: A $100M valuation ballpark for Xolo's Series B is reasonable
“But yes, I believe you are speaking about the right ballpark. But again, I've seen sometimes it's dangerous to come up with numbers and sometimes you hit too low, sometimes you hit too high.”
Allan Martinson Jan 17, 2022 ▶ 17:05
Assertion Not checkable as stated
Martinson: Most Xolo Churn Is From Solopreneurs Exiting Freelancing
“The majority of our churn is actually coming because the customers, they maybe go back to traditional employment or they wrap their businesses. Almost nobody leaves us because they don't like the service. A handful of the customers grow out from service.”
Allan Martinson Jan 17, 2022 ▶ 17:27
Assertion Not checkable as stated
Martinson: Xolo Experiences 20% to 25% Annual Customer Churn
“So it's between 20, 25% a year, which is pretty much like normal churn in like one-man businesses overall on the market.”
Allan Martinson Jan 17, 2022 ▶ 17:44
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